Which of the following is NOT a use of cash from financing activities?
A)Repayment of long-term debt
B)Proceeds from issuance of common stock
C)Proceeds for long-term borrowing
D)Both B and C

Question

Quizplus · Accepted Answer

Both B and C are actually uses of cash from financing activities. Proceeds from issuance of common stock represent an inflow of cash into the company, but it is still considered financing because it involves the sale of ownership in the company to investors. Likewise, proceeds from long-term borrowing represent an inflow of cash, but it is still considered financing because it involves taking on additional debt. Repayment of long-term debt, on the other hand, represents an outflow of cash and is a use of financing activities.

Which of the Following Is NOT a Use of Cash